A Retail Building Used in the Business of a Sole

question 57

Multiple Choice

A retail building used in the business of a sole proprietor is sold on March 10, 2018, for $342,000. The building was acquired in 2008 for $400,000 and straight-line depreciation of $104,000 had been taken on the building. What is the maximum unrecaptured § 1250 gain from the disposition of this building?

• A) $400,000
• B) $322,000
• C) $104,000
• D) $26,000
• E) None of the above

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Definitions:

Personal Income Taxes

Taxes imposed on individuals' income by the government, including wages, salaries, and investment earnings.

Federal Tax Revenues

The income earned by the government through all types of taxes, including income, payroll, and excise taxes, used to fund public services and operations.

Tax Freedom Day

A symbolic day representing when a nation's taxpayers have collectively earned enough income to pay the year's total tax bill.

Marginal Tax Rate

The rate at which an additional dollar of income is taxed, reflecting the percentage of each additional dollar that is paid in tax.